If your income varied during the year, you may be able to lower or eliminate the amount of one or more required installments by using the annualized income installment method.
To revisit the underpayment penalty section of your return and possibly elect, please follow the instructions below:
- Sign in to TurboTax and open or continue your return.
- Search for underpayment of taxes.
- Select the Jump to link in the search results.
- Select Continue to review this section and make any needed adjustments.
Generally, you'll have to pay an underpayment penalty for 2021 if you owe more than $1,000 in taxes (after taking withholding into account) and:
* Your taxes withheld don't cover at least 90% of your 2021 tax liability, or
* Your taxes withheld aren't at least 100% of your 2020 tax liability if your AGI is up to $150,000 or 110% if your AGI is more than $150,000. (The amount is $75,000 if you're married filing separately.)
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